UPDATE 1-Jackson Hewitt suspends quarterly dividend

March 12 (Reuters) - Jackson Hewitt Tax Service Inc
JTX.N, the No. 2 U.S. tax preparer, said it will suspend its
quarterly dividend to conserve capital and enhance its growth
prospects for 2010 and beyond.

The move will enable the company to save just over $20
million a year, and help develop its online presence and
expand
its retail distribution base, Jackson Hewitt said in a
statement.

Jackson Hewitt, which competes with H&R Block Inc (HRB.N: Cotización),
the largest U.S. tax preparer, paid a third-quarter dividend of
18 cents a share in December.

Last week, Jackson Hewitt forecast 2009 results well below
market estimates, and said it was seeking relief from lenders
regarding its leverage ratio covenant. [ID:nBNG157294]

Shares of the Parsippany, New Jersey-based company were
down 10 cents in trading after the bell. The stock closed at
$3.17 Thursday on the New York Stock Exchange. .
(Reporting by Anurag Kotoky in Bangalore; Editing by Deepak
Kannan)